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Investing.com -- Atos (EPA:ATOS) on Friday said it is set to implement a reverse stock split, with the process beginning on March 25, as part of efforts to stabilize its share structure and reduce volatility.
Shares of the company, operating in cybersecurity, cloud computing, and high-performance computing, fell over 8% by 03:25 ET (08:25 GMT).
The French IT company announced that the operation will involve exchanging 10,000 existing shares with a par value of €0.0001 each for a single new share valued at €1.
The move follows an increase in Atos’ share count due to capital raises under its accelerated safeguard plan.
With shares currently trading at low values, the restructuring aims to normalize the number of outstanding shares and foster a more stable stock market performance.
While the reverse stock split will not alter the overall value of individual shareholders’ holdings, it is expected to create a clearer market dynamic for investors.
Under the terms set by the company’s board of directors, the exchange period for shareholders will last for 30 days, from March 25 to April 23.
During this time, investors can adjust their holdings to ensure they hold multiples of 10,000 old shares, which will be automatically converted into new ones.
Shareholders left with fractional shares at the end of the period will be compensated by their financial intermediaries in line with French market regulations.
The final day of trading for the old shares will be April 23, after which they will be delisted. The newly consolidated shares will begin trading on Euronext (EPA:ENX) Paris on April 24 under the new ISIN code FR001400X2S4.
Atos confirmed that new shares will retain full voting rights, while old shares that are not exchanged will lose voting rights and dividend eligibility.